Q2 insurtech investment up 60%

We’ve just completed our H1 insurtech investment analysis and it makes for a very interesting read:

• 266 investments
• $7.6 billion invested
• $28.7 million average deal size
• The most common round being Seed – accounting for 23% of all deals

• $4.7 billion invested – 60% more than Q1
• $39.7 million mean deal size – nearly a 100% increase on Q1
• 63% of all deals were Early stage (Series B and below) investments

There’s so much in the numbers above, let alone the full review. Have a read of it here – it’s fascinating.

Nearly a quarter of investments are early stage. Insurance innovation is still very much in its emergence.

The number of deals stepped up in Q2. That I didn’t expect and interesting to see the rise in VC tourism (VCs coming in from other markets which are less favourable).

What also struck home was that investment into UK Insurtech contributed only 4.3% ($327 million) of the total. The US accounted for sitting at over 60% with India and China at 7.5% each.

Whilst the UK has such a strong and highly regarded insurtech investment scene, I can’t but help feel we’re going to get left behind if we don’t step things up.

Equally, when considering partnering with startups to accelerate your business, it’s a good reminder to make sure you’re looking at the global landscape.

Amazon launching auto insurance
This month we hear Amazon is launching auto insurance through India’s Amazon Pay. It’s a big step and one I’ve a feeling we might be looking back on for years to come.

For the UK readers, you might remember in 2014 Tim Steiner, CEO of the online supermarket Ocado, saying the company’s biggest future competition will come from Amazon rather than one of the big four supermarkets.

Looks like he called it right.

This week Amazon launched free, same day delivery to London-based Prime members. Their ambition is to roll this out across the UK by the end of the year.

In response to the news James Bailey, the CEO of Waitrose, said ‘it feels like the nuclear button has been pressed because [Amazon] have nuclear capacity behind them’.

How long do we give it before Amazon rolls out insurance across Europe and the US?

If you want to see what Amazon is up to globally, as well as the other 80k+ startups reshaping insurance, check out Sønr. It has everything you need to stay relevant, compete and plan for the future.

Investment into a world of scaling Insurtechs
I’m going to keep this one pretty short. As always, plenty of activity around the world.

Keeping with India and Policybazaar is planning an IPO in 2021, citing a valuation of $3.5bn+.

It’s aiming to raise a quarter of a billion in new capital and, if everything goes to plan, it would make it one of the biggest IPOs for an Indian startup.

And in the US SaaS company Duck Creek, having recently raised $230m, has filed for a $200m IPO.

I caught up with one of their team last week and it sounds like their sales have continued to grow despite the pandemic, and it looks like the IPO will allow them to invest in business growth as well as to buy back equity from certain existing investors.

A market that might well become my next obsession is LATAM. There’s so much emergent tech being spun up and one that caught my eye this week is Chilean life insurtech Burn To Give, which has raised a $8.5m Series A.

QBE North America has announced a strategic partnership with Flyreel – a leading AI platform for property insurance. It’s part of QBE’s drive to enable customers to conduct home inspections themselves, at their convenience and on their terms.

And in the UK insurtech Anorak has partnered with Open Banking fintech Snoop. Anorak’s life insurance platform will provide Snoop customers with access to regulated and digitally-provided advice about protection.

Who nose what to make of this?
I’ve heard so many ‘future of pet insurance’ pitches. But this one is the BEST.

Our friends at ZhongAn have launched noseprint recognition tech. That’s right. Sadly, for all hamster and goldfish owners, this is currently only available for dogs and cats. I know, tough times.

Oh, and it exceeds 99 percent accuracy. Just. Brilliant.

When the lemonade gets too sweet
On Monday, something unusual happened to Lemonade.

It’s lead underwriter, Goldman Sachs, initiated coverage of Lemonade Inc. stock on Monday with a sell rating and a $44 price target with analysts saying the insurer’s risk profile is not reflected in its valuation.

And so the stock was last trading down 7.6% albeit at the time of writing this is still sitting on a market cap of $3.5 billion.

Earlier this week I wrote a few thoughts on the Lemonade IPO for the Insurance Times, in particular just what it means to insurtechs and the future of the insurance industry. I appreciate it’s behind a paywall so shout if you can’t access it.

Insurtechs just wanna have sun
A regulator that embraces innovation, an island full of insurance and reinsurance companies, a world where we don’t need to be stuck in an office anymore, and a new 12-month visa that allows you to work on the beach.

In all seriousness, why not?

Have a read and if there’s even a remote chance you’re interested, I’d recommend dropping her a note. She’s pretty epic and will have you on a flight, supping Rum Swizzles before you know it.

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Time to call it a day. The sun is shining.

If you’d like a deeper analysis of the insurtech investment trends affecting your business, drop our research team a line.

If you’d like a trial of Sønr and access to the latest market trends, startups reshaping the market, and insight into your competitor’s innovation activity, head here.

If you’re based in Bermuda and would like to explore working with us, drop me a line. Failing that I’m sure I’ll be over soon.

Have good ones all.

Matt

Sønr is the world-leading market intelligence platform created specifically for the insurance sector. It provides you with the knowledge and tools to stay relevant, compete and plan for the future.

Try out a 14-day trial of Sønr to access intelligence on market trends, competitor playbooks and disruptive tech companies globally. Plus collaboration tools to help you track and manage innovation activity across your organisation.

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